France and Germany have a shared border. For example, the city of Strasbourg is located 8 kms from the German city of Kehl. With the European Union and the Schengen agreement, it is possible for french workers to work in Germany (and still living in France), and vice-versa. These workers don’t need a work or a residence permit to work in Germany. So the definition of a cross-boarder worker is a person who exercises it professional activity in a European country and who lives in an other country member of the European Union and go back regularly ( between one and seven times according to the countries) in his country. There are bilateral agreements between two countries which have a shared border, about tax system and social insurance.
This phenomenon exist also with other countries in Europe. For example between France and Switzerland, France and Luxembourg, and Italy and Belgium … In most cases, the situation is more profitable for French workers to work in an other country (for example in Switzerland or Luxembourg). The salaries for instance are often more higher.
There are 25 000 French workers who live in France but have a job in Germany. The first agreement about this subject was signed in 1959 by the two countries, in order to determinate the status of cross-boarder workers. To access to this status, the worker need to :
– live in one of these departments : Haut-Rhin, Bas-Rhin, Moselle.
– work in a area of 30kms beyond he border.
– come home for the night. ( possibility to sleep 45 days during one year in the country where you work).
If these criterions are not respected, you can’t claim for the status of cross-boarder worker, you will be considering like a German worker, and so you must pay the tax (like if you were a German worker). If you respect these criterions, you are liable to tax in your residence country and not in the country where you work.
Concerning the social insurance, in case of unemployment, there are two possibilities. For the “full-time unemployment”, the cross-boarder worker is going to receive the family allowance from the system in France. In the case of “short-time unemployment”, the salary will be reduced by the employer in Germany, but the German social insurance system will give a compensation to the worker, according to the agreement signed between the two countries.
About the employment law, the worker cross-boarder is subjected to the German employment law.
A demonstration is planed the 11 of May in Strasbourg by French retired people. They want to show their disapproval about the “discriminatory tax” of their private income by the German tax office. Until now, these persons were taxable in France, but the German tax office claim now taxes on their German retirement. French retired people who worked in Germany ask for an equality of treatment with German retired people, who receive allowance. The comity of workers cross-boarder consider that this tax is an “obstacle to the free movement of workers within the European Union”.
You can find in this web site more information about the labour market in the European Union and the free movement of workers :
Main sources :